US Retail Sales Flat in December, Signaling Slower Consumer Spending

Got story updates? Submit your updates here. ›

U.S. retail sales were unexpectedly flat in December 2023, putting consumer spending and the overall economy on a slower growth path heading into the new year, according to the Commerce Department's Census Bureau. Economists had forecast a 0.4% increase in December retail sales, but the actual reading was unchanged. Core retail sales, which exclude volatile items, fell 0.1% in December, potentially leading to downward revisions of fourth-quarter consumer spending and GDP estimates.

Why it matters

Retail sales are a key indicator of consumer spending, which drives a large portion of the U.S. economy. The flat reading in December, following an unrevised 0.6% increase in November, suggests that consumer demand may be softening amid higher prices and a weakening labor market. This could have broader implications for economic growth in the coming quarters.

The details

The Census Bureau reported that retail sales, which are mostly goods and are not adjusted for inflation, were unchanged in December 2023 after an unrevised 0.6% increase in November. Economists had forecast a 0.4% rise. Core retail sales, which exclude volatile items like automobiles, gasoline, building materials and food services, fell 0.1% in December after a downwardly revised 0.2% gain in November. These core retail sales correspond most closely with the consumer spending component of gross domestic product.

• Retail sales were unchanged in December 2023.
• Retail sales increased 0.6% in November 2023.
• The government will publish its delayed advance estimate of fourth-quarter 2023 GDP next week.

What’s next

The government will publish its delayed advance estimate of fourth-quarter 2023 GDP next week, which may provide more insight into the overall economic impact of the flat retail sales in December.